Fiat Chrysler Courts Google with Self-Driving Cars Deal

Photo courtesy Carlos Osoro, AP

By Brent Snavely, Detroit Free Press

WINDSOR, Canada — Fiat Chrysler Automobiles hopes its deal with Google to build 100 prototype autonomous minivans will be just the start of a longer relationship that could help it leapfrog other automakers in the race to self-driving cars.

Fiat Chrysler’s CEO, Sergio Marchionne, acknowledged that the initial deal to create 100 self-driving Pacifica hybrid minivans is “very targeted,” and limited in scope. He said Google, which has been developing autonomous vehicle technology for seven years, has more negotiating leverage than Fiat Chrysler, or any automaker, because of its profits and market value.

Nevertheless, Marchionne framed the deal with Google as the beginning of a relationship that could grow into a more full-fledged partnership with the potential of helping FCA expand its expertise with autonomous technology.

“We are approaching this in a completely open-ended fashion,” Marchionne said. “They found it easy to work with us and to explore and learn. Whether this is enough for them to feel comfortable to take the next step is unclear to me.”

Fiat Chrysler announced a deal Tuesday with the Silicon Valley tech giant’s 7-year-old autonomous car program. The deal is widely viewed as a coup for the Detroit-area automaker, which is behind competitors when it comes to the development of key technology. It also came amid a string of other deals and partnerships recently announced between Detroit automakers and Silicon Valley tech companies.

Fiat Chrysler said and Google plan to co-locate engineering teams at a site in southeastern Michigan and will work out of that site to do the design, testing and manufacturing of the self-driving Chrysler Pacifica — giving Fiat Chrysler an opportunity to gain insights from Google.

Google parent Alphabet’s market capitalization — the total dollar market value of all of a company’s outstanding shares — is $495 billion compared with $9.8 billion for Fiat Chrysler.

“We appear to be on the wrong end of the wealth distribution,” Marchionne said. “Some (tech companies) can buy us out of petty cash. And so it’s almost an unfair match when they decide to come in and participate with us.”

Marchionne made his comments about Google shortly before he spoke to thousands of workers at Fiat Chrysler’s Windsor Assembly Plant, which is near Detroit, for the launch of the 2017 Chrysler Pacifica, which is on sale now at dealerships.

Marchionne said the fleet of 100 Chrysler Pacifica minivans that it will produce for Google will look “physically different” after Google installs its sensors and self-driving technology.

“Take a look at the Google car, and then just imagine that in a minivan, whatever that looks like,” Marchionne said.